Student Registration: Contracts vs. Open Ended Agreements

When forming your student entry protocol, there are two major routes to consider: contracts or open-ended agreements. When structuring the memberships at your martial arts school, it’s key to remember that many students (and potential students) will have their own personal preference. Having a few options may give you more of a chance for prospective members to find a solution that works well for them.


While there are a number of different membership plans you can create, the most common would be contractual and open-ended. Weigh out the pros and cons of each, before deciding on what your martial arts school’s policy is going to be on new students, drop-ins and membership.



Contractual agreements would include any multi-month packages: for example, a 6-month package deal, discounted for paying up front. You could also have contracts where the members are paying monthly but will face a penalty if they leave early. Some schools create a non-refundable deposit system, while others may require prepaying for full months outright. These are fairly common in many fitness related industries and can give your long-term students a nice little bonus, with lower rates or added services for longer memberships.


Contracts can give you a guarantee and a certain level of security, allowing you to plan your business actions a bit easier, knowing how much revenue you will have coming in. However, some may make the mistake of thinking they have a lot higher annual revenues, because they had a large amount of prepaid lump sum transactions. You’ll want to make sure you ration these large amounts and keep your cash flow smooth, throughout the year. It’s not uncommon to find businesses struggling to pay their bills, because they used up all of the money so quickly. Keep track of your current memberships, last month and last year’s numbers and whose membership is going to expire soon, so that you can retain your students.


One thing to keep in mind is that a long-term contract doesn’t always spur long-term motivation for the student. Some people who get a huge burst of motivation (leading them to sign up) may find their initial motivation waver, leading to many missed classes, despite having already paid for them. To increase student retention, make sure you and your instructors are keeping tabs on missed classes and overall attendance, in order to identify any problems.


Open-Ended Agreements

Open-ended agreements are common for many students, as it can be difficult to commit long-term, as well as be able to pay with a large sum up front. These agreements can usually be terminated at any time, although a minimum notice time is commonly seen to allow for the school to anticipate loss of members. It’s important that your martial arts school has written guidelines around how this works, to avoid confusion.


Although the sense of security isn’t as high as contracts, these usually end up giving you more cash in the long run, since they’re not discounted as much. This also forces a smooth trickle of cash flow into your business, helping reduce the chance that you get caught in a bad cash flow position. Similar to trials, theis method is ideal for bringing in new students who aren’t familiar with your school.


Prospective students who aren’t sure whether or not they should join will appreciate this option. By making sure you provide a high quality teaching, this could potentially get you a lot more students than you would have without a monthly payment option. With the right instructors who engage students and get them motivated for success, you will find more and more drop-in and monthly students consider longer-term memberships. Create an incentive program for these students, if you have a period where you want to convert to bigger memberships. This can be tracked, in order to identify the right time for each student.


Want to manage your memberships more effectively? Learn why over 5,000 martial arts professionals use ChampionsWay’s membership management tools. No matter which method you choose, we’ll be there to make sure your software is running smoothly, while helping your school grow.


How do you structure your memberships at your martial arts school? Let us know on Facebook, and follow us on Twitter and Google+ to stay up to date with all of your ChampionsWay news.